In an address to the business community, Australian Trade Minister Don Farrell emphasized the need for businesses to diversify their customer base and reduce their dependence on a single market, particularly in light of the ongoing trade dispute with China. Australia's pursuit of a resolution through the World Trade Organization (WTO) reflects the country's commitment to finding a diplomatic solution to the wine tariff issue.
Australian Prime Minister Anthony Albanese expressed optimism about a potential breakthrough in the dispute over wine tariffs with China as the deadline for a WTO ruling approaches. This is seen as a positive development in the wake of strained trade relations between the two major trading partners, which resulted in China blocking trade in various exports in 2020.
Australia formally lodged a complaint regarding China's tariffs on its wine at the WTO in 2021. Prior to the imposition of tariffs, China had been Australia's primary wine export market, with exports peaking at A$1.2 billion ($770 million) for the 12 months leading up to January 2020.
Under the WTO dispute-resolution process, a report is shared with the involved parties before it is made public three weeks later. Officials are not permitted to comment publicly on a WTO report until after its publication.
Trade Minister Don Farrell emphasized that successful businesses understand the risks associated with relying too heavily on a single customer. He also acknowledged that certain trade impediments in the Chinese market, amounting to around A$2 billion in exports, have decreased significantly from their peak of A$20 billion during the height of the diplomatic dispute.
Australia's preference is to resolve trade issues with China through negotiation and dialogue, following the successful path taken in the barley dispute. In April, Australia temporarily suspended its complaint over Chinese barley tariffs at the WTO to allow China time to review and potentially remove the 80.5% duties imposed in 2020.
Minister Farrell stressed Australia's commitment to pressing its case for wine through the WTO while expressing the nation's desire to engage in discussions and dialogue as the preferred method of conflict resolution.
In addition to wine, other Australian exports such as live lobster and red meat continue to face trade barriers when entering the Chinese market. These issues underline the importance of diversifying export markets to mitigate risks associated with over-reliance on a single customer.